Even Bill de Blasio Won't Be Able to Fix Income Inequality

As mayor, he'd be battling the one percent—and history

September 6, 2013

New York Mayoral hopeful Bill de Blasio has surged in recent polls because of a strong campaign and a canny candidate, but also because this ardently liberal Democrat has captured the city’s broader mood. During twenty years of Giuliani and Bloomberg, crime plummeted and the economy surged, but inequality also increased and the city’s leadership rarely seemed to empathize with poorer New Yorkers. (Disclosure—until last May, I wrote a regular column for Bloomberg View.) New York may now hunger for social justice, but unless liberal activism is tempered with managerial competence and an appreciation of urban limits, we risk a repeat of the terrible path that many cities, including New York, traveled during the 1960s and 1970s.

Throughout much of its 20th century history, New York City’s politics divided between organization Democrats, like high-stepping Jimmy Walker and earnest Abe Beame, and Liberal Republicans, like the charismatic John Lindsay and the leonine Fiorella LaGuardia. The Democratic organization never forgot its base in working class ethnic enclaves, but its long history and tolerance for Tammany Hall’s corruption, gave it a hoary aura by the 1950s. The Liberal Republicans certainly included urban elites, but they gained a wider appeal with progressive, “good government” policies. Both groups would be significantly left-of-center in today’s politics.

That political division ended in the economic distress and social chaos of the 1970s. The debacle of Lindsay’s final years discredited the audacity of liberal Republican hope; near bankruptcy under Beame was the swan song of the Democratic organizations that dated back to Aaron Burr. In the summer of 1977, as the Bronx burned, the Son of Sam shot and a blackout engendered widespread looting, the city turned rightwards. Ed Koch, an erstwhile anti-Tammany reformer and once ardently liberal Democratic congressman, repositioned himself as the law-and-order candidate and bested Mayor Beame, Mario Cuomo and Bella Abzug, who like de Blasio today, represented the left wing of New York’s Democratic party.

The city’s humiliating bailout, during which financial control passed to non-elected officials, ushered in an era of diminished expectations. No one expected Koch to right every social wrong. It would be enough if he managed the city competently, balanced the books and brought crime under control. He won re-election twice as a capable, managerial mayor who still retained some obvious liberal passion, but during his third term, murder rates rose higher than they had been in 1977 and scandals scotched his administrative reputation. The city turned to another moderate Democrat, David Dinkins, who could hopefully heal the wounds in the city’s “gorgeous mosaic.” (Another disclosure: Dinkins serves on the advisory board of the Taubman Center, which I direct.)

The Dinkins years were tough. Murder rates remained high and unemployment rates remained above 10 percent for most of 1992 and 1993. The city had had enough and it elected a Republican, who could not possibly be called a liberal: Rudy Giuliani. For twenty years, Giuliani and his successor Michael Bloomberg have given the city competence and safety. Crime rates have plummeted, and public schools have improved. The searing experience of September 11, 2001, only heightened the sense that New York needs tough management more than liberal vision.

But ultimately, Bloomberg and Giuliani were so unlike the mass of New Yorkers that a backlash was inevitable. Other cities, including Chicago and Boston, faced similar problems in the 1970s and 1980s, and also turned to managerial mayors. But their leaders—Richard M. Daley, Thomas Menino—were passionate Democrats with roots in the neighborhoods. Their long tenures created no widespread longing for a missing liberal voice that would speak for the city’s less fortunate.

I have no opinion on de Blasio’s candidacy or the ideal outcome of New York’s mayoral race. The examples of Daley and Menino remind us that it is quite possible to have competent, business-friendly mayors, who bond with the poor as well as the prosperous.

Still, as New York voters contemplate a return to the liberal hopes of Lindsay and Dinkins, they need to remember that the mayor is fundamentally a manager of a vast, complex entity charged with delivering crucial services to eight million New Yorkers. They need to be sure that the next mayor doesn’t sacrifice the gains made over the past 20 years, in pursuit of objectives that no city, not even New York, can achieve at the local level. Urban resources are mobile—companies and wealthy individuals can readily relocate. That easy exit limits the ability of any liberal mayor to pursue dreams of using local taxes to fund generous programs that right social wrongs.

Despite that caveat, de Blasio could, in principle, create a mayoralty that is both competent and caring. He trumpets his experience helping immigrant entrepreneurs. Eliminating unnecessary regulations and ensuring a simpler permitting process is a great way to promote opportunity and economic diversity without threatening the city’s biggest taxpayers. Promoting added workplace regulations, which is also part of his plan, however, will only deter those entrepreneurs who employ poorer New Yorkers.

Similarly, New York could become more affordable if the city’s byzantine land use regulations were simplified and stripped down in ways that make it easier to build. The inclusionary zoning, which de Blasio strongly supports, may provide some affordable units, but only if it is accompanied by offsetting reductions in other barriers to building. If inclusionary zoning is simply added as one more regulatory burden on new construction, housing supply will become even more limited and prices will continue to rise.

De Blasio has tenacious intelligence and the liberal hopes that soared during New York’s Golden Age. But those hopes once crashed amidst a maelstrom of urban disasters. The lesson of that crash remain relevant today. New York can have a liberal mayor, but only if that mayor also has the competence of a Bloomberg or Giuliani, and a keen understanding of the fragility of urban economic eco-systems.